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What is Wrongful Dismissal?

By Tara Barnett
Updated May 17, 2024
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Wrongful dismissal, sometimes called wrongful termination, is the firing of an employee for reasons that violate either area laws or the employee's contract. The laws that govern what constitutes wrongful dismissal vary by area, and so a dismissal may be considered wrongful in one area but not another. Common reasons for termination that are considered wrongful include discrimination, refusal of intimacy, or an employee's refusal to commit an illegal act. When a wrongful dismissal suit is successful, the employee is often given monetary compensation because returning to work is often not possible.

An employee almost always has the right to know why he or she is being fired. In many areas, an employee must be given notice before he or she can be terminated. Failure to follow documented company procedures regarding termination of employment can result in wrongful termination lawsuits.

Commonly, an employee has the right to be treated in accordance with his or her contract, and violation of the contract constitutes wrongful termination. Additionally, an employer usually cannot fire an employee for bringing a lawsuit against the company. In general, principles that are valued in an area, such as gender equality and racial equality, are protected in employment. A person must be terminated for failure to live up to employment expectations, not for the employer's biases.

One of the major problems with wrongful dismissal is that employers are often knowledgeable about what constitutes wrongful termination and therefore never admit to the real reasons an employee is being terminated. There is often no way to prove one way or another why the employee was fired. For this reason, wrongful dismissal is often a frustrating subject for employees who effectively have no way to prove what they may know to be the truth.

When an employee is terminated for one reason on paper but the actual reason for termination could be argued to be different, an employee can still file a wrongful termination suit. For instance, if an employer states that the employee is being fired for being late but the employee very recently refused sexual advances from the employer, the employee may have a reasonable wrongful dismissal suit. In these cases with very cloudy facts, it often depends on which party has better lawyers to determine who wins the case.

In some areas, if an employer manages to convince an employee to quit by making work unbearable, the employee loses any right to file a wrongful dismissal suit. Sometimes employees have no rights whatsoever, particularly if they have signed documents stating they can be fired for any reason. Not all employees read or understand every document they sign, and employers may take advantage of ignorance to mistreat employees.

Many employers have figured out ways to prevent employees from filing wrongful dismissal suits. In many cases, employers hire only people who do not have enough money to seek legal representation, effectively ensuring that the company will never be sued. Some employers hire employees with contracts that include probationary periods during which the employee can be terminated for no reason at all. When people are desperate for work, employers frequently take advantage of the disenfranchised and force them to sign documents that allow termination for nearly any infraction. It is very important to always read the documents one signs and to stand one's ground when it comes to unfair hiring and firing practices.

WiseGeek is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
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